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What Impact Will Chinese Inflation Data, 'Plunging' Consumer Confidence Have On Trade Talks?

China's Commerce Ministry released a statement that recent trade talks with American counterparts were "generally positive," CNBC's Eunice Yoon reported. Yet around the same time the statement was released, government data showed the Chinese consumer price index fell to 1.9 percent — below the 3-percent upper limit the central bank had set.

Producer prices index also grew at the worst pace in two years and hit a six-month low at 0.9 percent versus expectations of 1.6 percent.

Consumer Confidence Is 'Plunging'

In addition to weakness in macro economic data, consumer confidence in China is "plunging," Hao Hong of the Bank of Communications International told CNBC in an interview. The Chinese central bank continues to introduce new monetary and other policies to support and stabilize the economy. If it is unsuccessful, the continued weakness in the Chinese economy will likely become "palpable and pervasive," he said.

Don't Expect China To Cave

The Chinese government has shown a willingness to "give what it can without threatening its strategic interests," Leon Levy of Eurasia Group told CNBC in an interview. The Chinese government doesn't "feel threatened enough" from its slowing economy to cave on any major issue, including industrial subsidies and technology transfers, Levy said.

'Overall Uncertainty'

"There's overall just basically uncertainty," Christian Fang of Moody's Investors Service told CNBC. At the start of the week, there were reports the two sides made some progress toward finalizing a trade agreement. What is more likely to be seen ahead of the March deadline are "swings between conflicts and compromise, competition and co-operation," he said.